Perth's Property Market Projection: Skyrocketing Prices Ahead

The Real Estate Institute of Western Australia (REIWA) has delivered an eye-opening forecast for Perth’s housing landscape, indicating a possible 20% hike in median house prices by the conclusion of 2024. The foundation for this prediction is a robust growth pattern, with Perth’s median house value surging an impressive 13.6% in the twelve months leading up to March, setting a new record at $625,000.

REIWA's chief executive, Cath Hart, highlighted the momentum gained over the last two quarters, with preliminary figures for March showcasing a healthy 4.2% growth rate, closely following the 4.3% uptick in the prior quarter. This positive trend suggests the market has the potential to meet or even exceed the forecasted growth. Hart points to the persistent imbalance between the burgeoning demand, driven by significant population growth, and the restrained supply of new housing stock as the primary fuel for the upward price trajectory.

Interestingly, while the number of newly-completed homes is on the rise, the commencement of new housing projects is declining. This has intensified the focus on existing homes, particularly in the outer suburbs of Perth, where the cost of buying is currently more economical than building from scratch.

The suburbs stretching the curve include Maddington, Armadale, Gosnells, Camillo, and Calista - all recording more than a 25% price climb over the previous year. The unit market in Perth also showcases robust growth with a 3.4% increase in median sale prices over the March 2024 quarter, reaching $425,000 - a notable 6.3% jump from the previous year.

Adding to the real estate dynamics, Perth's rental market continues to break records, with the median weekly dwelling rent reaching an unprecedented $650 at the end of March, reflecting remarkable year-on-year increases across both houses and units. With rental listings low and the vacancy rate hitting rock bottom at 0.4%, the rental sector remains challenging for tenants.

Amid these indicators, some agents report a cooling interest at the higher end of the market, while the more affordable segments remain vigorous. In a potential silver lining, increased supply is expected as newly built homes enter the rental market, particularly in suburbs with development land.

The Perth property market is undeniably a hotspot for investors and homebuyers, with strong potential for capital growth and rental yields. As the data unfolds, keeping abreast of market developments will be key for those looking to capitalize on this upward trend.

So, stay tuned and infuse your real estate decisions with these insights into Perth's burgeoning housing market.